What is the housing Advance Scheme?
The main aim of superannuation is to ensure people save for a financially secure lifestyle in retirement. Because of this, there are restrictions on withdrawing money from your super account. However, the Papua New Guinea superannuation laws recognise the need for appropriate housing in our society. This allowed for members to access 100% of their own contribution for Housing Advance before retirement.
The advance can only be used to finance your principal residence. This is defined as the house that you live in and go to work from, or that you will live in after you retire.
How you use your housing advance
If you meet the eligibility requirements and are granted a Housing Advance, you can use it to purchase an existing house, construct a new house or undertake renovations, extensions or improvements to an existing home.
- You must contribute to the fund continuously for over five (5) years You are eligible to use the total amount of your own Contributions (excluding any interest and employer contributions)
- You can also use your own contributions as equity towards a bank Loan to purchase a house, to renovate or extend an existing house
- You will also need to pay minimum 2% or more onto of your mandatory 6% deducted from your pay to offset the amount advanced to you
- The advance can only be used to finance your principal residence (only exception if you are within 5 years of reaching retirement age)
- The advance will also be only given to those that do not have any existing housing advance. If you have, you will need to pay off your existing one before applying for a new one
- If granted, your Housing Advance will be paid directly to the vendor or to the approved suppliers or bank.
You can increase your housing advance eligibility amount by doing voluntary contributions.